- Pound (GBP) underpinned by reopening optimism
- BoE Vlieghe’s dovish comments limits GBP gains
- Indian Rupee (INR) slips despite domestic equities rising
- Oil prices rise ahead of OPEC
The Pound Indian Rupee (GBP/INR) exchange rate is pushing higher on Tuesday. The pair edged end on Monday at approximately the same level that it started settling at 100.09. At 08:45 UTC, GBP/INR trades +0.37% at 100.46.
Sterling remains under pinned by encouraging covid data which revealed that the number of new daily covid infections continue to fall and deaths remain at the lowest level in around 6 months.
In an upbeat sign for the economy, high frequency data also showed that the number of people going to the shops rose by 6.6% compared to the previous week. The rise was partly owing to Britons refreshing their gardens ahead of the easing of lockdown restrictions.
Yesterday the UK continued along its path of the economy reopening with groups of six allowed to meet outside.
However, dovish comments by Bank of England’s policy maker Gertjan Vlieghe yesterday brough the Pound off session highs. Vlieghe believes that the UK economy will still need support from the central bank to return to its pre-pandemic growth path for some time, which dragged on demand for the Pound.
The UK economic calendar is light with no high impacting UK data due to be released today. Sentiment is likely to drive the Pound ahead of Wednesday’s Q4 GDP reading.
The Rupee trades lower despite domestic equities heading higher. The Sensex is trading over 1.6% higher boosted by banks.
Whilst the equity markets are upbeat, the weakness in the Rupee is reflecting concerns over surging covid cases and tightening lockdown restrictions
Oil prices are consolidating gains from the previous session, even as the containers vessel wedged in the Suez Canal was dislodged. Instead, investors are focusing on this week’s OPEC meeting. The OPEC+ group are broadly expected to keep production unchanged.
There is no high impacting Indian macro data today. Tomorrow sees the release of current account data.